The real estate industry is experiencing a boom in the market for rent-to-own homes, with new homes opening every day.
And for many buyers, a house can be a bargain.
But before you make a purchase, here’s what you need to know.
Read more: How to buy a home with a mortgage and finance it with your credit cardRent-to to-own houses have been gaining popularity since the recession.
They can be expensive, but are a great investment for those with down payments.
There are a few ways to make a rent-up-front deal: Buy the home first, then sell it and rent the equity to the seller at the market rate.
But you need a mortgage.
For the first month, you can borrow up to 30 percent of the mortgage.
But this is not a loan you want to take on if you’re not in a good financial position, according to a recent study by real estate consulting firm CBRE.
“This is a huge deal.
You’re putting yourself on the hook for all of these costs and you’re risking all the money you have,” said David Reuben, a senior advisor at CBRE, in an interview with The Associated Press.
The lender takes on the entire risk of any property, including any insurance you might have, which means you can’t put off your purchase until you see the property for yourself.
“When you’re renting, you’re basically giving the lender all the risk,” Reuben said.
“And it’s the lender’s job to take care of you if anything goes wrong.”
You may be better off taking a risk by buying a home first.
But when you buy, you have the option to buy at a lower price, Reuben added.
Buying a home early and getting the loan in place is a riskier proposition, and the payoff is much greater.
“You don’t want to be the first one to pull the trigger and make a mistake,” Reubens said.
But, with the right options, you may have a better chance of making a great deal.
“If you’re going to rent, you should be able to buy with that in mind,” Reber said.
There’s no hard and fast rule for when you should buy a property, but the longer you wait, the greater the risk of a foreclosure.
A short-term rental dealIf you’ve got a long-term mortgage, you could buy a rental home in a month or two for as little as $1,500 a month.
The cost of the loan will be lower, because you can take out the loan and keep the property while the mortgage is being paid off.
But if you take out a loan to rent your house, you’ll be required to pay a monthly fee of $2,000.
That fee is typically waived for first-time buyers.
Rental deals are available to most homeowners.
And you can even get a short- or long-lasting rental deal.
A quick check on the market, though, can help you decide whether a rental is worth the money.
The AP looked at listings on sites like Airbnb and HomeAway.
Some sites have low interest rates, but many charge high fees.
Some have been suspended for violating state and federal rules on mortgage servicing and foreclosure practices.
Renters can also look at mortgage rates from a broker such as Experian.
And many credit card companies offer discounts to homeowners who use their cards for rental.
A long-tenant mortgageWhile renting isn’t an option if you are not a long tenant, it’s a good option if your landlord refuses to rent to you.
“That’s the one place you can make the most money,” Reusse said.
“They can afford to give you the best rent possible and still make a profit,” he said.
It’s important to understand that there are some financial risks involved with renting a home, so if you can, ask your financial professional about any fees.
The most important thing to remember, though: Renting is not an option for everyone.
“The risk of losing your home is the real risk here.
It’s not something you want,” Reuches said.
If you need help buying a house, there are financial tools you can use.
There’s the mortgage broker, a trusted source of information about the market and rates.
And there’s the Betterment site, which provides advice on getting a mortgage, including finding a lender that’s low-cost and is well-established.
And don’t overlook the home-buying app, which can offer you real-time data on a range of homes and mortgage rates.
“With the app, you get a real-estate report that is not based on any of the data that is available,” Reuber said.